Bankruptcy + Reorganizations group lawyers Mark Fink and Richard Willi authored an article titled “Honest, but Still Unfortunate? Ninth Circuit Defines Authority of Social Security Administration to Recoup Overpayments Following Chapter 7 Discharge” published in the March issue of the American Bankruptcy Institute Journal. Their article highlights a notable Ninth Circuit decision where it ruled that the Social Security Administration (SSA) does not get a free pass to claw back overpayments just because the payment came from a benefits program, like Social Security Disability Insurance benefits. In this particular case, the court ruled that recoupment was impermissible given that the overpayment arose from the SSA’s own error, the debtor already received a no-asset Chapter 7 discharge, and there was no evidence of malfeasance by the debtor.

“The Ninth Circuit’s decision in Cooper is a significant win for innocent individuals receiving SSDI benefits, ensuring important protection for an otherwise-vulnerable class,” they write. “Courts are less likely to weigh only surface-level legal and factual connections and will instead explore the fundamental purposes of the Bankruptcy Code and any additional relevant statues to the case at hand.”

To read the article, click here.